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Debra Hoffman has practiced in the employee benefit and executive compensation area for over 30 years and had significant depth and breadth in all relevant areas, both in the domestic and international context. Her practice focuses exclusively in the areas of employee benefit plans and executive compensation and she advises both public and private clients daily with respect to on-going benefits and executive compensation matters, such as issues relating to employment agreements, equity and equity-based arrangements (including for LLCs and non-corporate entities), deferred compensation arrangements (including application of Code Section 409A), bonus and incentive arrangements (including application of Code Section 162(m)), severance agreements, change in control/golden parachute issues, governmental audits, pension de-risking, and compliance issues (including the IRS and DOL voluntary compliance submissions). Debra also advises creditors and debtors in connection with various types of financing structures, bankruptcy and reorganizations. In addition, Debra has extensive expertise with respect to issues arise in the context of corporate transactions, including divestures, acquisitions, mergers, spin-offs, and initial public offerings.

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On May 18, 2021, the IRS furnished much-needed guidance to employers on how to implement the COBRA premium subsidy provisions under the American Rescue Plan Act (ARPA). Notice 2021-31 includes more than seven dozen Q&As, which cover topics including eligibility requirements, applicable coverage periods and limitations, and notice and election procedures.

As summarized in our prior post, ARPA includes a 100% COBRA premium subsidy for “assistance eligible individuals” who elect (or who previously elected) COBRA continuation coverage for the period from April 1, 2021 through September 30, 2021. “Assistance eligible individuals” are generally those whose terminations occur as a result of an involuntary termination of employment (other than due to gross misconduct, for which COBRA is not available) or due to a reduction of hours.

ARPA provides that, by May 31, 2021, employers are required to distribute a notice regarding the COBRA premium subsidies to “assistance eligible individuals.” Given the May 31 deadline, employers were anxiously awaiting guidance from the IRS on many of the aspects of the COBRA premium subsidies. Pending issuance of guidance by the IRS under ARPA, many looked to the guidance that was issued to implement the 2009 American Recovery and Reinvestment Act (ARRA) COBRA subsidy for some indication of how the IRS might interpret ARPA’s provisions. Fortunately, much of the ARPA guidance—particularly relating to what constitutes an involuntary termination of employment—is consistent with that prior ARRA guidance.


Continue Reading IRS Issues Much Needed COBRA Guidance

On March 11, 2021, President Biden signed into law the American Rescue Plan Act of 2021 (ARPA) which contains a variety of employee benefit provisions. ARPA contains both mandatory and discretionary provisions relating to benefits. The following summarizes the provisions of ARPA relating to COBRA premium subsidies (mandatory changes), changes to the cap on pre-tax dependent care assistance benefits (discretionary), changes to section 162(m) of the Internal Revenue Code relating to a corporation’s deduction for executive compensation in excess of certain limitations (mandatory but not effective until 2026), and updates to the employee retention credit (initially implemented as a part of the Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act).


Continue Reading ARPA to the Rescue: COBRA Subsidies, DCAP Relief and More!

The first 100 days of President Biden’s presidency are likely to bring a number of changes for employer-sponsored health and welfare plans. The more than three dozen Executive Orders that were issued by the end of January included orders providing a special Affordable Care Act enrollment period, directing the review of policies (and strengthening of protections) related to the Affordable Care Act and Medicaid, and expanding coverage for COVID-19 treatment (including through group health plans) and healthcare for women. As is typical for an incoming administration, President Biden also issued a regulatory freeze, potentially impacting several pending and recently finalized health and welfare-related regulations.

These 100 days may also bring guidance on the various health-related provisions that were a part of the Consolidated Appropriations Act, 2021 (the “Act”), which became law at the end of 2020. We have already discussed the changes for health and dependent care flexible spending accounts under the Act. However, the Act also contained a number of other provisions applicable to health and welfare plans, many of which are intended to increase transparency for plan participants and patients.
Continue Reading The First 100 Days: Changes Afoot for Health and Welfare Plans

After several delays, the Consolidated Appropriations Act, 2021 (the “Act”) was signed into law on December 27, 2020.  Although the Act primarily addresses coronavirus emergency response and relief and appropriations through September 30, 2021, it also contains several provisions of interest for employers that sponsor benefit plans, including temporary flexibility for health care and dependent care flexible spending accounts (FSAs), changes to retirement plan provisions, and certain health care plan changes related to so-called “surprise billing”.  The following summarizes the provisions of the Act that affect health care and dependent care FSAs.

Continue Reading New Year, Old FSA Money?

The IRS and the Treasury Department, acknowledging the widespread impact of COVID-19, have issued Notice 2020-29 and Notice 2020-33, granting much-sought flexibility for flexible spending accounts (“FSAs”) and health plans.  Though the Section 125 cafeteria plan rules applicable to FSAs and health plans already permitted some limited election changes in the case of changes in status (for example, in the event of significant cost or coverage changes), they did not address the wide array of changes that many participants have wanted to make based on the ripple effects of the COVID-19 crisis.  In addition, the existing Section 125 rules required that any change to the election be consistent with (as determined under the rules) and on account of the applicable change in status.

Continue Reading Flexibility for Flexible Spending Accounts in Light of COVID-19

In addition to addressing the benefit and compensation provisions of the Coronavirus Aid Relief and Economic Security Act (the “CARES Act”) for their general employee population, most company boards of directors (or applicable board committees) are also grappling with the unique issues relating to compensation and benefits of their executive employees at an uncertain time

In the second of a series, our benefits team takes an in depth look at the provisions of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) affecting retirement plans. Changes include new coronavirus-related distributions, modified plan loan rules, and a temporary waiver of required minimum distributions.  Read more on the Mayer Brown

US employers are considering many alternatives to address the significant economic hardships caused by the COVID-19 pandemic. One such alternative is putting one or more groups of employees on furlough—a low paid or unpaid leave of absence. However, now more than ever, employers must carefully address health plan coverage during a furlough. See our Legal

The Families First Coronavirus Response Act, signed into law on March 18, 2020, is a  significant piece of federal legislation addressing the 2019 Novel Coronavirus (COVID-19) pandemic.  Among its many provisions is a broad requirement that group health plans and health insurance issuers provide coverage for COVID-19 testing without any cost sharing, prior authorization,

For an update on the Families First Coronavirus Response Act, which requires coverage of testing without cost sharing effective March 18, 2020, see our blog entry.

In an effort to remove barriers to testing for and treatment of the 2019 Novel Coronavirus (COVID-19), the Internal Revenue Service today issued Notice 2020-15. The Notice